Artificial Intelligence Market to Reach $1706.71 Billion by 2031, Registering a CAGR of 37.8%

Strategic Insights -

The global artificial intelligence market is expected to experience significant growth, driven by the increasing adoption of AI in various industries, government initiatives, and investments to support adoption. The market size was valued at $193.25 billion in 2024 and is projected to reach $1706.71 billion by 2031, with a compound annual growth rate (CAGR) of 37.8% during 2025-2031. The report from The Insight Partners highlights the importance of government initiatives, such as the US President's announcement of a $500 billion investment in AI infrastructure, and the growing demand for multimodal AI.

Key Takeaways:

  • The global artificial intelligence market is expected to grow from $193.25 billion in 2024 to $1706.71 billion by 2031, registering a CAGR of 37.8% during 2025-2031.
  • Government initiatives, such as the US President's $500 billion investment in AI infrastructure, are driving the market growth.
  • The demand for multimodal AI is expected to increase, driven by the need for AI solutions that can execute tasks like reasoning, learning, and problem-solving.
  • The market is segmented into hardware, software, and services, with the software segment dominating the market in 2024.
  • Large enterprises are driving the market, followed by SMEs, with the IT and telecom segment dominating the market in 2024.
  • Key players in the market include Accenture Plc, Advanced Micro Devices Inc, Google LLC, International Business Machines Corp, Intel Corp, Microsoft Corp, NVIDIA Corp, Amazon Web Services Inc, SAP SE, and SAS Institute Inc.
  • The report highlights the importance of ethical AI, with businesses investing in tools that prioritize transparency, fairness, accountability, and data privacy.
  • The establishment of initiatives like the Center for Accessible, Safe, and Ethical AI (CASE-AI) represents a strategic step toward ensuring that AI innovation is accountable and accessible.

Statistics:

  • Market size: $193.25 billion (2024), $1706.71 billion (2031)
  • CAGR: 37.8% (2025-2031)
  • Government investment: $500 billion (US President's initiative)
  • Multimodal AI: increasing demand
  • Software segment: dominating the market in 2024
  • Large enterprises: driving the market
  • IT and telecom segment: dominating the market in 2024

Sources:

  • The Insight Partners, "Global Artificial Intelligence Market Size and Growth Report (2021-2031)"
  • PRNewswire, "The Insight Partners Publishes Report: Global Artificial Intelligence Market Size and Growth Report (2021-2031)"